Rates set to rise again

After the latest comments from the Bank of England, financial analysts think a rise in the Bank’s base rate from 0.5% to 0.75% in May has become much more likely, with another one expected to follow in the Autumn.

At least four million households with variable or tracker rate mortgages are likely to see their payments increase once again.

Across the UK, 9.2 million households have a mortgage.

Of these, about half are on a standard variable rate or a tracker rate, amounting to between four and five million households.

These are the people who would be most affected, as their monthly payments would increase.

Those on such variable rates tend to be older, and with relatively small outstanding mortgage balances.

According to the Nationwide, a 0.25% rate rise means someone on a £200,000 mortgage would face paying around an extra £25 a month, or about £300 a year.

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